CHRIS’S CORNER: That Darn Arithmetic

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By: Chris Voccio

Niagara Falls City Council Chairman

The problem facing Niagara Falls city government finances comes down to one powerful force that is the root cause of our issues: Arithmetic.

Long before anyone heard of COVID-19, our city government was operating with $10 million deficits, hidden by a seemingly limitless supply of casino cash.

When the casino cash came to a halt, our overspending became obvious. Then the governor stepped in to give us “advances” on the casino cash, once again burying our fiscal recklessness.

Then, all of a sudden, a terrible virus popped up, inflicting all sorts of damage worldwide, including economic damage that is impacting people, businesses and governments everywhere. But our city government, which had a spending problem to begin with, was particularly exposed.

It’s not a difficult problem to grasp. It doesn’t require an understanding of advanced algebra or calculus. You do not need an MBA or an understanding of high finance. It’s as simple as this: We’re spending more than we can afford.

Pre-coronavirus, I’ve stated on multiple occasions that we need to put government on a diet, that we need to right-size city government. Now, with anticipated revenues falling dramatically (not to mention a big question mark around casino cash), it would seem it’s finally time to heed the call for fiscal responsibility.

Not so fast.

A whopping 80%+ of our city expenses are employee related. So there’s no way for us to meaningfully reduce spending without it impacting employees, and they are represented by seven unions.

But the municipal unions, who are sometimes seemingly more powerful than the force of arithmetic, want nothing to do with fiscal responsibility. They don’t want to help us get out of this crisis. Not at all.

City leaders asked union leaders, despite their union contracts, to help save the city, to make small sacrifices, even temporary sacrifices, to get us through this crisis. The unions weren’t interested in sacrificing for the sake of the city.

Don’t get me wrong. Not all of the municipal unions are the same, and some unions, and some employees within those unions, have it much better than others. But for some, it’s a racket. A racket that must be protected.

Let me list a few examples of what I mean when I call it a racket:

  • In 2019, we had dozens of employees work the racket to generate thousands of dollars in overtime, with some employees raking in upwards of $80,000 in overtime alone. (That’s over and above their salary and benefits and why there’s such a large number of city employees who make far more than $100,000.)
  • Work rules in union contracts that force up overtime are padding payrolls and in 2019 total overtime expenses were north of $4 million.
  • Union contracts also lavish generous gifts to employees that retire, with recent retirement payouts for some employees surpassing $100,000. This doesn’t even include the hefty pensions.

We simply can’t keep going down this road.

While the refusal of the unions to help the city may force city government to take some short-term steps to get us through this situation, it will also force us to take steps to permanently change the way we do business. And that’s a good thing.

If only the dastardly laws of arithmetic could be avoided, we could continue the practice of ignoring fiscal responsibility. We could continue to lavish some of the public sector unions with even more expensive goodies. Alas, we cannot.

While the unions may appear to have won this battle, arithmetic will eventually be the victor. To the benefit of the citizens.

Chris Voccio is the Chairman of the Niagara Falls City Council and can be reached at ChrisVoccio@gmail.com.

 

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